More laws target owners of abandoned houses

— -- As foreclosures mount around the country and vacated homes slowly turn into neighborhood eyesores, governments from California to Chicago to Rhode Island are cracking down on owners in a variety of ways.

Chicago started banning plywood. Providence can now fine up to 10% of the assessed value of the home. Garland, Texas, is requiring a $2,500 bond the city can use to keep up the property.

The aim is to prevent the crime and declining home values that accompany rows of boarded-up homes.

Richard Monocchio, acting commissioner of the Chicago Department of Buildings, said the new rules are purposefully stringent.

"It puts a little more of a financial bite on the owner and hopefully gives some impetus to do something with the property," he said.

Among the new laws:

• Owners of vacant properties in Chicago will only be allowed to use plywood on doors and windows for six months. Owners will have to use more expensive metal panels or outfit the home with working doors, windows and an alarm system.

• Providence Planning Director Thomas Deller said his department could begin imposing the new fines — which can be up to 10% of the assessed value of the property — within months.

• California passed a law that allows areas to fine owners up to $1,000 a day if they fail to maintain the lawn, keep out squatters or allow standing water, a breeding ground for mosquitoes.

• Garland approved an ordinance that requires owners of "abandoned and distressed" properties to post a $2,500 bond the city can tap into to maintain the property.

At least 93 cities around the country have passed vacant property laws this year, according to Rob Hicks of FIS Field Services, a company that helps lenders manage properties that have defaulted and gone into foreclosure.

According to the National Conference of State Legislatures, at least six states have passed or are considering similar laws this year.

Dustin Hobbs, a spokesman for the California Mortgage Bankers Association, said it is difficult for his members to track all the laws being passed. He said if states don't implement uniform rules it will be cumbersome to stay on top of them.

"If every city and county comes up with their own solution, it's absolutely going to drive up the cost of lending," Hobbs said.

Hicks said some of the requirements — like maintaining water and electricity at unsold properties — are becoming too expensive. He hopes governments will consult with lenders to find compromises.

"The solution is cooperation," he said.